Earnings Call Excerpt
M&T Bank Corporation (MTB)
Q1 2008 Earnings Call
April 15, 2008 3:00 pm ET
Executives
Don Macleod – Director of Investor Relations
René F. Jones – Chief Financial Officer, Executive Vice President
Analysts
Ken Zerbe – Morgan Stanley
Steve Alexopoulos – JP Morgan Securities
Matt O'Connor – UBS
Bill Rubin – The Boston Company
Gaurav Patankar – SuNova Capital
Collyn Gilbert - Stifel Nicolaus
Salvatore DiMartino – Bear Stearns
Bob Hughes - Keefe, Bruyette & Woods, Inc. (KBW)
Gary Paul – Private Investor
Presentation
Operator
At this time, I would like to welcome everyone to the M&T Bank First Quarter 2008 Earnings Conference Call. (Operator Instructions) It is now my pleasure to turn the floor over to your host, Don Macleod, Director of IR.
Don Macleod
Thank you, Natasha, and good afternoon everyone. This is Don Macleod and I’d like to thank everyone for participating in M&T’s First Quarter 2008 Earnings Conference Call, both by telephone and through the webcast. I hope everyone has had an opportunity to read our earnings release issued this morning. If you’ve not read our earnings release, you may access it, along with the financial tables and schedules, from our website at www.mtb.com and by clicking on the Investor Relations link.
Also, before we start, I’d like to mention that comments made during this call may contain forward-looking statements pertaining to the banking industry and to M&T Bank Corporation. M&T encourages participants to refer to our SEC filings including those found on Forms 8K, 10K and 10Q for complete discussions of forward-looking statements. Now, I’d like to introduce our Chief Financial Officer, René Jones.
René Jones
Thank you, Don, and good afternoon everyone. As Don mentioned, I’m sure you got a chance to review this morning’s press release. I’d like to highlight and expand upon a few items from that release before I respond to questions.
Diluted earnings per share, which includes the amortization of core deposits and other intangible assets, were $1.82 in the first quarter of 2008, compared with $1.57 in the first quarter of 2007 and $0.60 found in the late quarter. Net income for the first quarter of 2008 was $212 million, compared with $176 million a year earlier and $65 million earned in the sequential quarter.
The company’s results in the recent quarter were 85 membership interests in Visa. M&T Bank and many other large banks received shares of stock in Visa in collection with Visa’s initial public offering. Member banks were required to redeem portions of their shares in the recent quarter which, in M&T’s case, resulted in an after-tax gain of $20 million, or $0.18 of diluted earnings per share. Visa also established an escrow account to cover the pending litigation costs prior to distributing shares to its owners. As a result, the company was able to reverse a portion of the accruals that dampened our results in the fourth quarter of 2007, equal to our estimated share of those escrow balances. That amounted to $9 million after tax, or $0.08 of diluted earnings per share. Visa then added $29 million to the company’s first quarter net income or $0.26 of diluted earnings per share.
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